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Wei-ZheTan

Sentiment was also lifted by the safe passage of the U.S. healthcare legislation in the House of Representatives late Sunday.

"Asian equity markets were unduly concerned about the U.S. health care bill yesterday," said BBY Senior Institutional Trader Peter Copeland in Sydney. "There was some concern that the U.S. market would take a dim view of the reforms, but the reverse happened, so we have just unwound yesterday's fall."

Japan's Nikkei 225 was down 0.4% as the market resumed trade following a holiday Monday. Australia's S&P/ASX 200 was up 1.0%, South Korea's Kospi Composite was up 0.6%, China's Shanghai Composite fell 0.3%, Hong Kong' Hang Seng Index gained 1.0%, Taiwan shares were up 0.2%, and India's Sensex was 0.4% higher. Dow Jones Industrial Average futures were three points lower in screen trade.

In Australia, the market was rising on gains in materials, banks and utilities plays.

BBY's Copeland said a lot of investors who recently positioned themselves for a double dip in the market were likely to unwind some of that positioning as Wall Street remained resilient and most of the recent U.S. economic data were better than expected.

Arrow Energy was down 1.8% at A$5.01 after investors gave up hope that Royal Dutch Shell and PetroChina Co. will further increase their offer to buy the bulk of Arrow's Australian assets. The original bid of A$4.45 per share was increased to A$4.70 per share.

Exporters were weighing on the Japanese market, as an uptick in the yen against the U.S. dollar on Monday dampened demand. The yen, however, was losing some ground against the euro and the dollar in early trade.

"Concerns about Greece's debt problems are persistent, and exporters with relatively high presence in Europe are underperforming," said Yutaka Miura, senior technical analyst at Mizuho Securities.

Mazda Motor was down 1.6%, Canon gave up 0.6% and Nikon was off 1.6%.

Toshiba rose 3.6% on news the company and Microsoft Chairman Bill Gates will jointly lead an effort to develop a next-generation nuclear reactor that can operate for up to 100 years without refueling.

Technology stocks were helping the Korean market trade higher.

However, Kumho Tire tumbled 12.8% after the company said its capital base had been severely eroded by lower production and sales, coupled with higher non-operating costs. The company said its capital base fell 81% to KRW64.48 billion in 2009 from KRW350 billion the previous year. "The news prompted concerns over a potential reduction in capital stock," said Lee Sun-yup, market analyst at Shinhan Investment Corporation.

In Hong Kong, China Telecom, the country's largest fixed-line operator by subscribers, rose 6.5% after reporting a huge jump in fiscal year net profit to CNY14.42 billion (US$2.11 billion), from CNY884 million a year earlier, when the company booked a CNY24.17 billion impairment loss on property, plants and equipment mainly associated with the handyphone business.

Bank of China's H-shares in Hong Kong were up 2.5% as investors awaited the release of its 2009 full year results due later in the day.

Shares in China reversed earlier gains as financial stocks and property developers weakened on concerns about weaker dividends from the upcoming earnings reports. "The monetary tightening theme still holds, and banks would have to keep more of their profits in reserves, rather than reward investors," said Zhang Gang from Southwest Securities.

In foreign exchange markets, the euro was holding steady with traders continuing to focus on a resolution to Greece's fiscal problems. The common currency reversed earlier losses on Monday after European Central Bank President Jean Claude Trichet said the ECB wouldn't oppose bilateral aid from other members of the euro area if it were tied to strict conditions. The euro was at $1.3556 against the U.S. dollar, from $1.3554 in late New York trade Monday and at Y122.44 from Y122.21. The dollar was at Y90.30 from Y90.15.

Most traders expect the euro to remain under pressure due to the ongoing uncertainty over the Greek debt issue. "The euro's near term outlook is bleak. Market participants want euro supportive factors including any specific measures to prevent Greece's default, but those steps look difficult to implement in reality," said Gaitame.com chief analyst Daisaku Ueno.

Japanese government bonds were up on gains in U.S. Treasurys Monday. The lead 10-year contract was up 0.15 at 138.78 points. Minutes from the Bank of Japan's February meeting, released earlier in the day, should be supportive for the JGB market, said Atsushi Ito, strategist at Morgan Stanley. "The minutes show that the BOJ should ease more to get rid of deflation expectations."

Spot gold was at $1,104.30 per troy ounce, up $1.70 from the New York close after falling below the $1,100 support in Monday's trade. "Previous declines below $1,100 triggered emerging market gold demand; (emerging market) buying would likely stabilize prices, but possibly not until Greek fiscal debt concerns fade," said HSBC analyst James Steel.

Nymex April crude futures were down 13 cents at $81.49 per barrel on Globex.

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